RAI Draws Attention to Cigarette Smuggling

WINSTON-SALEM, N.C. -- Reynolds American Inc. (RAI) is shining a spotlight on the estimated $5.5-billion toll that cigarette smuggling takes on states each year with the launch of a  new website called "The New Tobacco Road."

According to RAI, much of that smuggling traffic takes place on the East Coast along Interstate 95, as cigarettes from lower-tax states are being brought to states with higher taxes in the Northeast. The new website, which calls the I-95 corridor the "New Tobacco Road," is designed to draw attention to the problem and encourage states to pass stiffer penalties for smuggling and devote more resources to enforcement.

The website, www.thenewtobaccoroad.com, shows how I-95 has become a key transit route for cigarette smuggling from southern states to the Northeast. The illegal profits that are being derived from these operations benefit an organized-crime infrastructure already established in transporting illegal drugs and other contraband, and fostering violent crime up and down the interstate, the company said.

"Cigarette smuggling is becoming the new currency of organized gangs, creating a new culture of crime along the busy Northeast corridor, and robbing state and local governments of billions of dollars in tax revenues," said Richard Marianos, a retired 27-year veteran of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), who has investigated many tobacco smuggling cases.

Marianos will be blogging on The New Tobacco Road website.

"Right now, the financial reward for smuggling cigarettes far outweighs the risks of punishment," he said. "We're very hopeful that the new website will give legislators information they need to stiffen penalties and increase enforcement."

The website, which is sponsored by RAI subsidiary RAI Services Co., will provide information of interest to lawmakers, law enforcement officials and concerned citizens on how serious the problem of cigarette smuggling really is, and what federal and state governments can do about it.

"The illicit trade of cigarettes is not a victimless crime. It funds organized crime, costs the states billions in tax revenues and hurts law-abiding retail businesses," said Bryan Hatchell, director of communications for RAI. "The cigarette black market also undermines one of our companies' main objectives -- to keep tobacco products out of the hands of minors. People who are selling cigarettes illegally don’t ask buyers for identification. They sell to anyone with money."

The website features access to recent studies and news reports on the prevalence and cost of cigarette smuggling for the major states along The New Tobacco Road. The site will be updated regularly with reports on smuggling activity, new blog reports from Marianos and updates on efforts by states to combat cigarette trafficking, according to RAI.

"We need tougher laws and more enforcement resources all along The New Tobacco Road," Marianos said. "We hope this site will help raise awareness among law-enforcement leaders, state legislators, federal officials and concerned citizens. Tobacco smuggling needs to become a law-enforcement priority."

Winston-Salem-based Reynolds American Inc. is the parent company of R.J. Reynolds Tobacco Co., American Snuff Co. LLC, Santa Fe Natural Tobacco Co. Inc., Niconovum USA Inc., Niconovum AB and R.J. Reynolds Vapor Co.